A building inspection pinpoints all defects that need repair guides you on negotiating the price and allows you to avoid buildings with adverse problems. A building inspection report informs you of everything that could be wrong.
Don’t expect to find a perfect score; otherwise, you might never purchase anything. When you know all the defects, how serious they are, and the cost of repair, you can decide on whether to buy or not.
Most buyers stress over building inspection reports, especially when dealing with older buildings. In most cases, there is always an issue with period homes. This is because they were built using different construction methods and materials compared to modern homes. If you plan on purchasing a period home, be ready to receive a report with defects.
For instance, when looking for a Victorian terrace, the building report might indicate that there is no protection against rising damp. The report sounds unsatisfactory, but this is a common issue in Victorian terraces.
Building reports are long and scary. Talk to your inspector for clarity after reading the report summary. They will give you appropriate advice that will help you make an informed decision.
When your building inspection fails, your next move depends on your type of contract.
Purchasing a property involves signing a contract. Every contract has terms which must be agreed upon by the buyer and the seller. Most real estate contracts are conditional. This means that certain conditions must be met before closing the purchase deal.
The standard contract conditions include building and pest inspections and finance. Therefore, if a property fails a building inspection, you have an option of cancelling the contract without a penalty.
However, the main question is what a failed building inspection is? The answer differs.
Ensure that you familiarise yourself with the terms and conditions of a conditional contract before signing. Contracts differ; therefore, you need to confirm that whatever you consider a failed building inspection report is what is highlighted in the contract.
What happens if the inspection report has defects?
- A contract is cancelled only if the defects are major.
- If the minor defects are detected, the vendor will repair the damages before closing the deal.
- The vendor can correct major defects. However, there might be a contract period extension.
- The contract may have an option to renegotiate the price to cater for the defects and cost of repair.
- If the damage is extreme, you will have an option to terminate the contract.
Seek Legal Advice
If you decide to cancel the contract, ask for legal advice immediately. Remember, contracts are admissible in court. Therefore if you are not sure of the process, hire a legal professional.
Most building damages can be corrected, but a few can’t. When you get your building inspection report, concentrate more on the property’s drainage and foundation. For a pest inspection report, look for details on pest infestation on the structure. These defects can be fatal and call for contract cancellation.
After booking for building inspection, be clear about the areas you want to be inspected. Some building inspections do not include some structures like garages or external fixtures.